Microsoft's Plan to Bridge the US Digital Divide

We recently wrote about AT&T's expansion of its fixed wireless programme to bring broadband access to rural, disconnected areas in the US. The provider is rolling out LTE-based Internet access to selected residential areas, beginning in several southern states (see AT&T Expands Its Fixed Wireless Service). With speeds of about 10 Mbps, the service won't be exceptionally fast, but the goal is to bring basic connectivity to underserved areas.

AT&T's programme receives funding through the Connect America Fund, an initiative from the US Federal Communications Commission (FCC). The FCC regards Internet access as a fundamental utility and points to parallels in electrification of the country almost a century ago. The vast majority of areas were hooked up to the grid, but there were gaps, mainly in rural locations. According to Microsoft, more than 23 million people in hard-to-reach parts of the US still don't have a broadband connection, partly owing to a lack of service.

After experimenting with ways to deliver broadband access to areas in developing markets, Microsoft is now focussing on the underserved in its backyard.

On Tuesday, at an event in Washington, the company announced a programme to bring connectivity to rural communities in the US, where residences and businesses have no reasonable way to remain connected to the Internet. Microsoft plans to use TV spectrum that exists between broadcasts to address connectivity problems. It has developed and tested software, along with chipsets, devices and TV white spaces antennas to exploit the unused spectrum. The company has also trialled services using the components in several African countries, as well as in Bhutan, Jamaica, the Philippines and Uruguay. Microsoft says it has deployed the technology in 17 countries and served 185,000 users.

For the programme to be effective, Microsoft says the FCC must allow broader use of white spaces spectrum in the country. To make use of the spectrum, a base station that transmits signals at the proper frequency is required, along with matching external antennas installed on residences. The antennas are hardwired to modems inside the house. TV signals use 600 MHz, so they could travel relatively far and over hills and through buildings.

Microsoft plans to collaborate with local telecom companies in 12 states over the next 12 months and is offering relevant patents royalty-free. Its ambitions for the programme, which it calls the Rural Airband Initiative, is to provide broadband access to 2 million people in rural areas in the US by 2022. Microsoft sees the initiative as a "civic investment", but like all other technology companies racing to offer Internet connections, it hopes there will be long-term dividends through new customers.

Microsoft's vision isn't without its detractors. The National Association of Broadcasters, a US trade group representing TV and radio broadcasters, sees the white spaces as its territory and believes Microsoft's plans to use the spectrum without paying any licensing fees is paradoxical for a company worth $540 billion.

These accusations of encroachment, free-riding and frequency interference could slow Microsoft's vision, but competition from established technologies and the ambitions of large telecommunication companies will pose bigger challenges.